B-160555, FEB. 3, 1967

B-160555: Feb 3, 1967

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BOARD OF COMMISSIONERS OF THE DISTRICT OF COLUMBIA: THIS IS IN REFERENCE TO YOUR LETTER DATED DECEMBER 13. OUR VIEWS ARE REQUESTED AS TO WHETHER FEDERAL LAW. YOU ALSO ASK WHETHER OUR ANSWERS WOULD BE THE SAME IN THE EVENT THE DISTRICT OF COLUMBIA WERE TO CARRY OUT THE PROPOSED PROGRAMS BY DETAILING CLASSIFIED EMPLOYEES FOR DUTIES AS CLERKS AND CASHIERS WITHIN A BANK OR OTHER PLACE OF BUSINESS. PROVIDED SPACE WERE MADE AVAILABLE WITHOUT CHARGE. IT IS STATED IN YOUR LETTER THAT IF THERE ARE NO OBJECTIONS OF A FISCAL OR LEGAL NATURE. A STUDY TO EXPLORE THE FEASIBILITY AND PRACTICABILITY OF DESIGNATING BANKS AND OTHER FINANCIAL INSTITUTIONS TO SERVE AS COLLECTION AGENTS WAS MADE BY REPRESENTATIVES OF THE DISTRICT GOVERNMENT AND THE FINDINGS.

B-160555, FEB. 3, 1967

TO PRESIDENT, BOARD OF COMMISSIONERS OF THE DISTRICT OF COLUMBIA:

THIS IS IN REFERENCE TO YOUR LETTER DATED DECEMBER 13, 1966, AND ENCLOSURE, CONCERNING A PROPOSAL TO AUTHORIZE LOCAL BANKS, OTHER FINANCIAL INSTITUTIONS, AND VARIOUS PRIVATELY OWNED BUSINESSES TO SERVE AS AGENTS FOR THE ISSUANCE, AT A NUMBER OF LOCATIONS THROUGHOUT THE DISTRICT OF COLUMBIA, OF MOTOR VEHICLE LICENSE TAGS AND DOG TAGS, AND THE COLLECTION OF REAL ESTATE TAXES AND WATER AND SEWER BILLS. THE CONCERNS WOULD BE COMPENSATED EITHER ON A PIECE RATE, PERCENTAGE, OR OTHER BASIS, FOR SERVICES RENDERED.

OUR VIEWS ARE REQUESTED AS TO WHETHER FEDERAL LAW, REGULATORY PROCEDURES, OR ADMINISTRATIVE POLICIES (1) PROHIBIT THE USE OF APPROPRIATED FUNDS AS PAYMENT TO PRIVATE BUSINESS FIRMS FOR PERFORMING SUCH FUNCTIONS, (2) FORBID THE RECEIPT AND HANDLING BY NONGOVERNMENT ORGANIZATIONS OF PUBLIC FUNDS IN THE MANNER PROPOSED, OR (3) PREVENT THE DISTRICT FROM DEPOSITING ITS FUNDS AND COLLECTIONS IN BANKS IN CONSIDERATION FOR THE PERFORMANCE OF THIS SERVICE FOR THE DISTRICT, AT NO COST TO IT, RATHER THAN EXCLUSIVELY WITH THE UNITED STATES TREASURY. YOU ALSO ASK WHETHER OUR ANSWERS WOULD BE THE SAME IN THE EVENT THE DISTRICT OF COLUMBIA WERE TO CARRY OUT THE PROPOSED PROGRAMS BY DETAILING CLASSIFIED EMPLOYEES FOR DUTIES AS CLERKS AND CASHIERS WITHIN A BANK OR OTHER PLACE OF BUSINESS, IN LIEU OF UTILIZING THE REGULAR PERSONNEL OF SUCH CONCERNS, PROVIDED SPACE WERE MADE AVAILABLE WITHOUT CHARGE.

IT IS STATED IN YOUR LETTER THAT IF THERE ARE NO OBJECTIONS OF A FISCAL OR LEGAL NATURE, THE DISTRICT GOVERNMENT WOULD LIKE TO INITIATE THE PROPOSED DECENTRALIZATION PROGRAM BY MAKING AUTOMOBILE LICENSE TAG RENEWALS, WHICH GO ON SALE BEGINNING MARCH 1, 1967, AVAILABLE TO THE PUBLIC AT SEVERAL DISPERSED LOCATIONS IN THE CITY.

A STUDY TO EXPLORE THE FEASIBILITY AND PRACTICABILITY OF DESIGNATING BANKS AND OTHER FINANCIAL INSTITUTIONS TO SERVE AS COLLECTION AGENTS WAS MADE BY REPRESENTATIVES OF THE DISTRICT GOVERNMENT AND THE FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS ARE SET FORTH IN THE REPORT DATED MAY 12, 1966, TRANSMITTED WITH YOUR LETTER. THE REPORT ON THE STUDY DOES NOT INCLUDE PROCEDURES FOR CARRYING OUT THE PROPOSED DECENTRALIZATION AND UPON INFORMAL INQUIRY BY REPRESENTATIVES OF OUR CIVIL DIVISION IT WAS LEARNED THAT PROCEDURES FOR IMPLEMENTING THE PROPOSAL HAD NOT BEEN PREPARED. THERE IS NO COMPREHENSIVE ESTIMATE OF ADDITIONAL COSTS THAT MIGHT BE REALIZED, BUT IT APPEARS, ON THE BASIS OF THE STAFF STUDY, THAT TOTAL COLLECTION EXPENSES WILL INCREASE. THE TASK FORCE STUDY RECOGNIZES THAT THE MAIN BENEFIT OF SUCH A SYSTEM APPEARS TO BE IMPROVED PUBLIC SERVICE AND CONVENIENCE, ALTHOUGH EVEN IN THIS REGARD IT IS SAID THAT THE POTENTIAL BENEFITS TO THE PUBLIC MAY BE MINIMAL.

IN REPLY TO THE FIRST PART OF YOUR QUESTION AS TO WHETHER FEDERAL LAW, REGULATORY PROCEDURES, OR ADMINISTRATIVE POLICIES PROHIBIT THE USE OF APPROPRIATED FUNDS AS PAYMENT TO PRIVATE BUSINESS FIRMS FOR PERFORMING SERVICES SUCH AS DESCRIBED, THERE IS FOR CONSIDERATION THE GENERAL RULE THAT SERVICES NECESSARY TO THE TRANSACTION OF GOVERNMENT BUSINESS WHICH ARE NORMALLY PERFORMED BY GOVERNMENT EMPLOYEES UNDER DIRECT GOVERNMENT SUPERVISION MAY BE PERFORMED BY A PRIVATE BUSINESS FIRM UNDER A CONTRACT ONLY IF THAT METHOD OF PROCUREMENT IS DETERMINED TO BE PREFERABLE FOR REASONS OF ECONOMY, FEASIBILITY OR NECESSITY AND ONLY IF THE CONTRACT IS MADE ON A NONPERSONAL SERVICE OR JOB BASIS, I.E., THE CONTRACT IS FOR THE PERFORMANCE OF A COMPLETE SERVICE PERFORMED WITHOUT DETAILED SUPERVISION BY GOVERNMENT EMPLOYEES OVER THE CONTRACTOR'S EMPLOYEES. 44 COMP. GEN. 761, AND DECISIONS CITED THEREIN.

CONCERNING ITEMS (2) AND (3) THE ACT OF MARCH 3, 1881, CH. 134, 21 STAT. 460, SEC. 47.301 D.C. CODE, CONTAINS REQUIREMENTS OF LAW CONCERNING THE HANDLING OF PUBLIC FUNDS WHICH DO "/2) FORBID THE RECEIPT AND HANDLING OF PUBLIC FUNDS IN THE MANNER PROPOSED" AND "/3) PREVENT THE DISTRICT FROM DEPOSITING ITS FUNDS AND COLLECTIONS IN BANKS IN CONSIDERATION FOR THE PERFORMANCE OF THIS SERVICE FOR THE DISTRICT, AT NO COST TO IT, RATHER THAN EXCLUSIVELY WITH THE UNITED STATES TREASURY.' THE ACT PROVIDES:

"* * * THE COLLECTOR OF TAXES FOR SAID DISTRICT SHALL * * * COLLECT ALL REVENUES OF THE DISTRICT AND DEPOSIT THE AMOUNTS COLLECTED DAILY WITH THE TREASURER OF THE UNITED STATES.'

PURSUANT TO REORGANIZATION ORDER NO. 121, DATED DECEMBER 12, 1957, AS AMENDED, THIS FUNCTION WAS ASSIGNED TO THE TREASURY DIVISION OF THE FINANCE OFFICE, DEPARTMENT OF GENERAL ADMINISTRATION.

IN VIEW OF THE ABOVE STATUTORY REQUIREMENT CONCERNING THE COLLECTION AND DEPOSIT OF REVENUES WITH THE TREASURER OF THE UNITED STATES, IT WOULD BE NECESSARY THAT SPECIFIC STATUTORY AUTHORITY BE OBTAINED TO PERMIT SUCH FUNDS TO BE HANDLED IN THE MANNER PROPOSED.

IN REGARD TO YOUR QUERY AS TO WHETHER OUR ANSWER WOULD BE THE SAME IN THE EVENT THE DISTRICT WERE TO CARRY OUT THE PROPOSED PROGRAMS BY DETAILING CLASSIFIED EMPLOYEES FOR DUTIES AS CLERKS AND CASHIERS WITHIN A BANK OR OTHER PLACE OF BUSINESS, IN LIEU OF UTILIZING THE REGULAR PERSONNEL OF SUCH CONCERNS, PROVIDED SPACE IS MADE AVAILABLE TO THE DISTRICT WITHOUT CHARGE, WE SEE NO LEGAL DETERRENT TO SUCH PROPOSAL ASSUMING OF COURSE THAT SUCH CLASSIFIED EMPLOYEES PERFORM DUTIES SOLELY FOR, AND UNDER THE DIRECTION AND CONTROL, OF THE DISTRICT OF COLUMBIA AND THE AMOUNTS COLLECTED ARE DEPOSITED IN ACCORDANCE WITH THE CITED LAW.